The European Union's Markets in Crypto-Assets framework has created an uneven playing field for stablecoin issuers, with 14 out of roughly 23 authorized electronic money token issuers unable to custody their own tokens for clients, according to ESMA's interim register.
Only nine companies have obtained full authorization covering both EMT issuance and Crypto-Asset Service Provider services. Patrick Hansen, Circle's Head of EU Strategy and Policy, said that most stablecoin issuers in the EU cannot provide custody of their own tokens on behalf of clients, severely limiting the services they can offer.
The restrictions do not affect retail holders, who can still transfer tokens between non-custodial wallets. However, the B2B segment has been hit hard: without a CASP license, issuers cannot hold tokens in custody or process automated payouts for corporate clients.
To launch such services, issuers must complete the Article 60 MiCA notification procedure, which can take up to a year in jurisdictions such as France or Luxembourg. While waiting, some issuers are migrating to third-party regulated platforms and forming forced B2B alliances.
Circle, issuer of USDC and EURC, together with Société Générale-Forge, has emerged as a main beneficiary of this fragmentation. The development gives the top tier a long-term advantage in the competition for institutional capital within the European Economic Area until the euro stablecoin sector moves beyond forced alliances.
A notable example is the French stablecoin EURØP from Schuman Financial, which holds EMT status but not CASP authorization. The project has natively integrated its asset into the XRP Ledger and uses Ripple's European MiCA CASP and EMI licenses to provide legal custody and transfers across 30 European countries.
Compliance under Article 60 in major EU jurisdictions takes from several months to a year, guaranteeing top-tier issuers an extended advantage.
